A Test of Warren Buffett's 90:10 Retirement Portfolio

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Park
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A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Park » Sat Dec 22, 2018 11:24 am

https://seekingalpha.com/article/362334 ... ion-advice

For the retirement portfolio of his wife, Warren Buffett has recommended 10% in short term government bonds and 90% in a very low cost S&500 index fund.

An academic tested that portfolio using US stocks and Treasury bills:

https://seekingalpha.com/article/362334 ... ion-advice
https://papers.ssrn.com/sol3/papers.cfm ... id=2680084

"Returns are annual, adjusted for inflation and account for capital gains/losses and cash flows. Over the 114 year period considered, from 1900 to 2014, stocks and US T-bills had mean annual compound real returns of 6.5% and 0.9%, with annual volatility of 20.0% and 4.6%. The test portfolio was rebalanced once a year and the study assumes an annual withdrawal is made proportional to the asset allocation. The analysis is based on an initial capital balance of $1,000, an initial withdrawal of 4% of the capital and subsequent withdrawals annually adjusted for inflation over a 30-year period."

Eight static portfolios were tested ranging from 30% stocks/70% bills to 100% stocks.

"Buffett’s suggested allocation seems to provide a middle ground between the best performing strategy (100/0) in terms of upside potential and the best performing strategies (60/40 and 70/30) in terms of downside protection."

The author then discusses two modified 90:10 strategies (T1 and T2), which are dynamic allocation strategies (market timing?).

"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."

"Both T1 and T2 outperform the 90/10 allocation. Although, the three strategies have the same failure rate (2.3%). T1 and T2 provide retirees with both a higher upside potential (as measured by the mean, median, P90, P95, and P99) and better downside protection (as measured by both P5 and P10) than the 90/10 allocation."

T1 and T2 have better P5 and P10 than any of the eight static portfolios. The failure rates of the 70/30 (1.2%), 60/40 (0%) and 50/50 (1.2%) are lower.

If the retirement portfolio is in a taxable account, this may change results. As stocks tend to be more tax friendly than bonds/cash, this would likely result in more favorable results for higher stock portfolios.

About risk, the following comment would favor the higher stock portfolios. There is the risk of unexpected expenses in retirement. A portfolio with a greater upside potential will likely be better able to mitigate that risk.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by nedsaid » Mon Jan 07, 2019 1:18 pm

I would not recommend a 90% stock/10% treasury allocation for any retiree unless they had very substantial pension and Social Security income. Such a portfolio would simply be too volatile for retirees. Such a portfolio would probably have lost over 40% during the 2008-2009 bear market.
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by MarkRoulo » Mon Jan 07, 2019 1:32 pm

Park wrote:
Sat Dec 22, 2018 11:24 am
https://seekingalpha.com/article/362334 ... ion-advice

For the retirement portfolio of his wife, Warren Buffett has recommended 10% in short term government bonds and 90% in a very low cost S&500 index fund.

An academic tested that portfolio using US stocks and Treasury bills:

https://seekingalpha.com/article/362334 ... ion-advice
https://papers.ssrn.com/sol3/papers.cfm ... id=2680084

"Returns are annual, adjusted for inflation and account for capital gains/losses and cash flows. Over the 114 year period considered, from 1900 to 2014, stocks and US T-bills had mean annual compound real returns of 6.5% and 0.9%, with annual volatility of 20.0% and 4.6%. The test portfolio was rebalanced once a year and the study assumes an annual withdrawal is made proportional to the asset allocation. The analysis is based on an initial capital balance of $1,000, an initial withdrawal of 4% of the capital and subsequent withdrawals annually adjusted for inflation over a 30-year period."
I don't think his wife will be taking 4% annually out of her assets after Warren is dead.

I bet that things work JUST DUCKY with a 0.1% withdrawal rate.

Waaren's advice is for his wife ... who will have billions of dollars to invest, not $1,000.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by johan851 » Mon Jan 07, 2019 1:34 pm

MarkRoulo wrote:
Mon Jan 07, 2019 1:32 pm
I don't think his wife will be taking 4% annually out of her assets after Warren is dead.

I bet that things work JUST DUCKY with a 0.1% withdrawal rate.

Waaren's advice is for his wife ... who will have billions of dollars to invest, not $1,000.
Exactly. Warren Buffet's 90/10 portfolio sounds like terrific advice for Warren Buffet's wife.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by JoMoney » Mon Jan 07, 2019 1:38 pm

Park wrote:
Sat Dec 22, 2018 11:24 am
...
The author then discusses two modified 90:10 strategies (T1 and T2), which are dynamic allocation strategies (market timing?).

"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."

"Both T1 and T2 outperform the 90/10 allocation. Although, the three strategies have the same failure rate (2.3%). T1 and T2 provide retirees with both a higher upside potential (as measured by the mean, median, P90, P95, and P99) and better downside protection (as measured by both P5 and P10) than the 90/10 allocation."
...
I don't read it as "market timing", it's just one-way rebalancing. When stocks are up you take your withdrawals from that, and move any extra over to cash/bonds to keep the allocation. But if stocks go down you simply take your withdrawals from the cash/bonds, but you never use your cash/bonds to buy more stocks... you just spend cash down until the portfolio is back to 90/10 or stocks have started to rise again.

At the start of the withdrawal, 10% represents 2.5 years of full withdrawals. If the balance continued to grow at >4% real rate, 10% would represent a larger number of years over time.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by knpstr » Mon Jan 07, 2019 1:45 pm

MarkRoulo wrote:
Mon Jan 07, 2019 1:32 pm
I don't think his wife will be taking 4% annually out of her assets after Warren is dead.

I bet that things work JUST DUCKY with a 0.1% withdrawal rate.

Waaren's advice is for his wife ... who will have billions of dollars to invest, not $1,000.
I don't know that she will have billions. All of his Berkshire stock is going to charity.
I bet that she'd have many millions.
I bet he'll leave behind what he thinks is necessary for her lifestyle, he'll donate the rest as that is his nature.
Remember this is Warren Buffett. He wouldn't let his daughter have a personal loan to remodel her kitchen. He isn't going to leave money that he thinks may be squandered.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by nisiprius » Mon Jan 07, 2019 2:09 pm

What's often left undiscussed in discussions of Buffett's supposed* "retirement portfolio" is the possibility that his widow might have something to say about this.

I don't know whether his will is specifically written to prevent her from altering the portfolio or take control away from the trustees, and I certainly don't know what estate law has to say about this, but she will probably be wealthy enough to hire a pretty good estate lawyer if she does wish not to stick with 90/10. And for many reasons, if he has strong feelings about 90/10, it would be advantageous for her to say "yes, of course dear" and not indicate her real feelings until after his death.

Traditional, the ultrawealthy usually take the position that they want to preserve their wealth, not grow it. Of course, entrepreneurs like Buffett would not feel that way, but from what comes up in a few web searches--which is very, very little--her wife, Astrid Menks, has never been an entrepreneur.

At one point it transpired that Suze Orman's personal portfolio, even though it was "only" $25 million, was 4% stocks, 96% individual municipal bonds. Steven Goldberg, of Kiplingers, wrote a column in 2007, expressing something close to anger at the conservative investments of the then-President and Vice-President:
[one of them has]just 2% to 4% of his money in stock and balanced funds, according to his recently released 2006 financial disclosure report. The remainder is in money-under-the-mattress investments: bank checking accounts, certificates of deposit, money-market mutual funds and Treasury bills and notes. [He] lists between $4.6 million and $9.7 million in these ultra-low-risk investments. By contrast, he has a meager $205,000 in stock and balanced funds.
*I say "supposed" because from his actual words, it is not at all clear that he recommends 90/10 for anyone but his wife. "Warren's" fans are sure that they know how to interpret things that he doesn't say, but I'm not sure they do. To me, the main emphasis of the chairman's letter in which he discusses this, is not that the allocation should be 90/10; it's how to invest that 90%. The message is "just put my wife's entire stock allocation into an S&P 500 index fund."
Last edited by nisiprius on Mon Jan 07, 2019 2:16 pm, edited 3 times in total.
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Leesbro63 » Mon Jan 07, 2019 2:14 pm

nedsaid wrote:
Mon Jan 07, 2019 1:18 pm
I would not recommend a 90% stock/10% treasury allocation for any retiree unless they had very substantial pension and Social Security income. Such a portfolio would simply be too volatile for retirees. Such a portfolio would probably have lost over 40% during the 2008-2009 bear market.
If they had big pension/SS income, it wouldn’t really be a 90/10 portfolio. Which, I guess, is actually your point. (Because the pension/SS is a fixed income substitute)

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Leesbro63 » Mon Jan 07, 2019 2:20 pm

knpstr wrote:
Mon Jan 07, 2019 1:45 pm
MarkRoulo wrote:
Mon Jan 07, 2019 1:32 pm
I don't think his wife will be taking 4% annually out of her assets after Warren is dead.

I bet that things work JUST DUCKY with a 0.1% withdrawal rate.

Waaren's advice is for his wife ... who will have billions of dollars to invest, not $1,000.
I don't know that she will have billions. All of his Berkshire stock is going to charity.
I bet that she'd have many millions.
I bet he'll leave behind what he thinks is necessary for her lifestyle, he'll donate the rest as that is his nature.
Remember this is Warren Buffett. He wouldn't let his daughter have a personal loan to remodel her kitchen. He isn't going to leave money that he thinks may be squandered.

Her lifestyle...let’s see: Keeping up the 1956 house, new Cadillac every 5 years whether she needs it or not, daily Egg McMuffin, with the fixings on days when the market is up, cases of Coke, Dairy Queen for lunch, steakhouse for dinner, See’s Candy for dessert, occasional new chair from Mrs. B’s furniture mart and a flip phone. Yeah, even a halving of the S&P’s dividend on her shares should cover all that 🤣

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Hector » Mon Jan 07, 2019 2:31 pm

It is interesting that we love talking about rebalancing, buying low and selling high in-spite of the fact that these activities don't increase overall return.
When portfolio size is extremely large, I would think that people would prefer higher return over reduced short term volatility.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by aristotelian » Mon Jan 07, 2019 2:34 pm

I would find it very hard to believe he does not leave her at least just a little bit of BRK stock.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by knpstr » Mon Jan 07, 2019 2:40 pm

aristotelian wrote:
Mon Jan 07, 2019 2:34 pm
I would find it very hard to believe he does not leave her at least just a little bit of BRK stock.
Unless he (Buffett) goes back on his pledge every single share of BRK goes to charity.

He has never touched his BRK stock for personal use, ever. He has always kept a small personal portfolio that he lives off of on the side that does not mix with any investments with BRK and he says all of his best ideas go to BRK. Notable personal investments is a large farm that his son farms and rental real estate near NYU.

He started with $174,000 in 1956 and was going to retire. But of that $100 went into his partnerships which became BRK. He lived on the rest $173,900 (with his eventual $100K/yr income from BRK).

Munger, on the other hand, thinks his heirs should hold BRK for their portfolios.
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by 2015 » Mon Jan 07, 2019 2:54 pm

I stopped reading after "an academic tested that portfolio. Beware the publish or perish crowd and their all too many unverified conclusions.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by nedsaid » Mon Jan 07, 2019 3:02 pm

Leesbro63 wrote:
Mon Jan 07, 2019 2:14 pm
nedsaid wrote:
Mon Jan 07, 2019 1:18 pm
I would not recommend a 90% stock/10% treasury allocation for any retiree unless they had very substantial pension and Social Security income. Such a portfolio would simply be too volatile for retirees. Such a portfolio would probably have lost over 40% during the 2008-2009 bear market.
If they had big pension/SS income, it wouldn’t really be a 90/10 portfolio. Which, I guess, is actually your point. (Because the pension/SS is a fixed income substitute)
Yes. Pensions and Social Security could be considered as a bond. Mr. Bogle has discussed this many times. You made an excellent observation.
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by cheezit » Mon Jan 07, 2019 3:21 pm

nisiprius wrote:
Mon Jan 07, 2019 2:09 pm
Steven Goldberg, of Kiplingers, wrote a column in 2007, expressing something close to anger at the conservative investments of the then-President and Vice-President:
[one of them has]just 2% to 4% of his money in stock and balanced funds, according to his recently released 2006 financial disclosure report. The remainder is in money-under-the-mattress investments: bank checking accounts, certificates of deposit, money-market mutual funds and Treasury bills and notes. [He] lists between $4.6 million and $9.7 million in these ultra-low-risk investments. By contrast, he has a meager $205,000 in stock and balanced funds.
Regardless of any potential wealth preservation mindset, isn't it the norm for officials elected to very high office to put the vast majority of their assets in a blind trust inclusive-or to put them in treasuries or similar instruments, to avoid the appearance of a conflict of interest that would come with holding substantial equity positions?

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by DanMahowny » Mon Jan 07, 2019 3:26 pm

I like Mr Buffett. Indeed, he has done very well. But doing as Warren does, and as Warren says, is probably a bad idea for the rest of us.

A 90/10 portfolio in retirement is just crazy.

Even worse is Mr Buffett's diet. He eats like a 6 year old. Ice cream cones, popsicles, Cokes, and candy bars. Actually a 90/10 portfolio might be okay considering I'd be dead before I reach 60.
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by heyyou » Mon Jan 07, 2019 4:31 pm

His BRK stock is going to the Gates Foundation. His cash (IIRC $200 million) is going to his widow. Yes, she can live on the dividends from $180 million in a S&P 500 fund, or spend from the $20 million in Treasury bonds, or both since she is in her 70s.
Maybe she will post here asking for advice.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by andrew99999 » Tue Jan 08, 2019 6:59 am

Park wrote:
Sat Dec 22, 2018 11:24 am
"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."
The wacky thing about this is ... if the market drops 50% and then has an "up" year that is up say 10%, then you are taking from stocks again when it is still severely suppressed. Similarly if the market has risen by 100% over the past 5 years and then drops 5%, you are taking from bonds, which doesn't make much sense either.

Having said that, 10% with a 4% withdrawal rate isn't going to last long anyway.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Park » Tue Jan 08, 2019 10:25 am

JoMoney wrote:
Mon Jan 07, 2019 1:38 pm
Park wrote:
Sat Dec 22, 2018 11:24 am
...
The author then discusses two modified 90:10 strategies (T1 and T2), which are dynamic allocation strategies (market timing?).

"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."

"Both T1 and T2 outperform the 90/10 allocation. Although, the three strategies have the same failure rate (2.3%). T1 and T2 provide retirees with both a higher upside potential (as measured by the mean, median, P90, P95, and P99) and better downside protection (as measured by both P5 and P10) than the 90/10 allocation."
...
I don't read it as "market timing", it's just one-way rebalancing. When stocks are up you take your withdrawals from that, and move any extra over to cash/bonds to keep the allocation. But if stocks go down you simply take your withdrawals from the cash/bonds, but you never use your cash/bonds to buy more stocks... you just spend cash down until the portfolio is back to 90/10 or stocks have started to rise again.

At the start of the withdrawal, 10% represents 2.5 years of full withdrawals. If the balance continued to grow at >4% real rate, 10% would represent a larger number of years over time.
The following insight I got from Larry Swedroe. This strategy will result in you tending not to buy stocks, when their expected return is highest. Although with a 90:10 portfolio, it won't make much difference.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Park » Tue Jan 08, 2019 10:32 am

andrew99999 wrote:
Tue Jan 08, 2019 6:59 am
Park wrote:
Sat Dec 22, 2018 11:24 am
"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."
The wacky thing about this is ... if the market drops 50% and then has an "up" year that is up say 10%, then you are taking from stocks again when it is still severely suppressed. Similarly if the market has risen by 100% over the past 5 years and then drops 5%, you are taking from bonds, which doesn't make much sense either.

Having said that, 10% with a 4% withdrawal rate isn't going to last long anyway.
Your points are well taken. This strategy works better for short market downturns than long ones. If you rebalanced every 2 (3?) years, that might address your question.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by matthewbarnhart » Tue Jan 08, 2019 11:35 am

nisiprius wrote:
Mon Jan 07, 2019 2:09 pm
*I say "supposed" because from his actual words, it is not at all clear that he recommends 90/10 for anyone but his wife. "Warren's" fans are sure that they know how to interpret things that he doesn't say, but I'm not sure they do. To me, the main emphasis of the chairman's letter in which he discusses this, is not that the allocation should be 90/10; it's how to invest that 90%. The message is "just put my wife's entire stock allocation into an S&P 500 index fund."
Exactly. My read of the letter is: costs matter, and indexing beats active management. The actual asset allocation is up to the reader.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by JoMoney » Tue Jan 08, 2019 12:22 pm

Park wrote:
Tue Jan 08, 2019 10:25 am
JoMoney wrote:
Mon Jan 07, 2019 1:38 pm
Park wrote:
Sat Dec 22, 2018 11:24 am
...
The author then discusses two modified 90:10 strategies (T1 and T2), which are dynamic allocation strategies (market timing?).

"The first change [T1] relates to the annual withdrawal to the behavior of the stock market in the previous year. If stocks have gone up, the retiree takes the annual withdrawal from stocks and then rebalances the portfolio back to the 90/10 allocation. Conversely, if stocks have gone down, the retiree takes the annual withdrawal from bonds and does not rebalance the portfolio."

"Both T1 and T2 outperform the 90/10 allocation. Although, the three strategies have the same failure rate (2.3%). T1 and T2 provide retirees with both a higher upside potential (as measured by the mean, median, P90, P95, and P99) and better downside protection (as measured by both P5 and P10) than the 90/10 allocation."
...
I don't read it as "market timing", it's just one-way rebalancing. When stocks are up you take your withdrawals from that, and move any extra over to cash/bonds to keep the allocation. But if stocks go down you simply take your withdrawals from the cash/bonds, but you never use your cash/bonds to buy more stocks... you just spend cash down until the portfolio is back to 90/10 or stocks have started to rise again.

At the start of the withdrawal, 10% represents 2.5 years of full withdrawals. If the balance continued to grow at >4% real rate, 10% would represent a larger number of years over time.
The following insight I got from Larry Swedroe. This strategy will result in you tending not to buy stocks, when their expected return is highest. Although with a 90:10 portfolio, it won't make much difference.
A 100% stock portfolio will have you "not buying stocks" in a downturn as well, and yet that is the portfolio with the highest expected return.
The 10% in short-term government bonds is just a cushion to smooth out short term down turns or liquidity issues, not really a trading scheme to pick better times to buy stocks.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Tamalak » Tue Jan 08, 2019 12:49 pm

Warren Buffett can afford to be 90:10 because he owns his house outright and he knows at guy at Dairy Queen who can hook him up if things get dicey.

Not everyone is in the same position as him. Adjust your AA to your situation.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Valuethinker » Wed Jan 09, 2019 6:17 am

Leesbro63 wrote:
Mon Jan 07, 2019 2:20 pm
knpstr wrote:
Mon Jan 07, 2019 1:45 pm
MarkRoulo wrote:
Mon Jan 07, 2019 1:32 pm
I don't think his wife will be taking 4% annually out of her assets after Warren is dead.

I bet that things work JUST DUCKY with a 0.1% withdrawal rate.

Waaren's advice is for his wife ... who will have billions of dollars to invest, not $1,000.
I don't know that she will have billions. All of his Berkshire stock is going to charity.
I bet that she'd have many millions.
I bet he'll leave behind what he thinks is necessary for her lifestyle, he'll donate the rest as that is his nature.
Remember this is Warren Buffett. He wouldn't let his daughter have a personal loan to remodel her kitchen. He isn't going to leave money that he thinks may be squandered.

Her lifestyle...let’s see: Keeping up the 1956 house, new Cadillac every 5 years whether she needs it or not, daily Egg McMuffin, with the fixings on days when the market is up, cases of Coke, Dairy Queen for lunch, steakhouse for dinner, See’s Candy for dessert, occasional new chair from Mrs. B’s furniture mart and a flip phone. Yeah, even a halving of the S&P’s dividend on her shares should cover all that 🤣
I believe Buffett's (first) wife moved to San Francisco to pursue her career as a singer (correction: as a philanthropist of the arts)?

She helped his mistress move in to look after him. That I do remember, clearly - a very pragmatic deal.

DId he then marry his mistress after his wife died?

https://www.warrenbuffett.com/warren-buffett-mistress/

Buffett is clearly ASD (so is his great friend, Bill Gates). A lot of super talented people are*. The spouses have adapted to that.

Mrs. Steve Jobs does not live like Steve Jobs did.

* Eindhoven, Netherlands, has 4x the incidence of autistic children of other Netherlands towns. Alex Baron-Cohen (cousin of Ali G, the comedian) is a famous neurologist at Cambridge who studies this area. His view (which he said he has not been able to prove) is that there is heritability at work - people on the spectrum seek out others on the spectrum for compatibility (they understand the obsessions etc.) - remembering that the characterization/ diagnosis is probably quite "male centric" **. Eindhoven? The home town of Philips Electronics - engineers marrying engineers. I can think of a couple of couples from my university years who seem to show that.

** just as one problem with psychology research is the prevalence of data on American college students as subjects, so too diagnosis is gender-biased and culturally biased -- I don't know to what extent we have come to grips with that. I think women with many of these issues may get "missed" because little girls don't show exactly the same behaviours as boys. Perhaps that's true more historically than now.

The success of people like Buffett (I have a friend who works for NASA who shows some similar traits) indicates how much "pathology" in, for example, a child, turns out to be actually a talent - a gift, as well as a challenge. I have seen the same with ADHD in adults.
Last edited by Valuethinker on Wed Jan 09, 2019 6:28 am, edited 1 time in total.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Valuethinker » Wed Jan 09, 2019 6:24 am

DanMahowny wrote:
Mon Jan 07, 2019 3:26 pm
I like Mr Buffett. Indeed, he has done very well. But doing as Warren does, and as Warren says, is probably a bad idea for the rest of us.

A 90/10 portfolio in retirement is just crazy.

Even worse is Mr Buffett's diet. He eats like a 6 year old. Ice cream cones, popsicles, Cokes, and candy bars. Actually a 90/10 portfolio might be okay considering I'd be dead before I reach 60.
You need to (re)-watch Woody Allen's Sleeper ;-).

It is amazing what the 22nd century has discovered about our eating habits ;-).
Dr. Melik: This morning for breakfast he requested something called "wheat germ, organic honey and tiger's milk."
Dr. Aragon: [chuckling] Oh, yes. Those are the charmed substances that some years ago were thought to contain life-preserving properties.
Dr. Melik: You mean there was no deep fat? No steak or cream pies or... hot fudge?
Dr. Aragon: Those were thought to be unhealthy... precisely the opposite of what we now know to be true.
Dr. Melik: Incredible.

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DanMahowny
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by DanMahowny » Wed Jan 09, 2019 7:33 am

Valuethinker wrote:
Wed Jan 09, 2019 6:24 am
DanMahowny wrote:
Mon Jan 07, 2019 3:26 pm
Even worse is Mr Buffett's diet. He eats like a 6 year old. Ice cream cones, popsicles, Cokes, and candy bars. Actually a 90/10 portfolio might be okay considering I'd be dead before I reach 60.
You need to (re)-watch Woody Allen's Sleeper ;-).

It is amazing what the 22nd century has discovered about our eating habits ;-).
I need to watch. Will be my first time. Thanks.
Funding secured

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J G Bankerton
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by J G Bankerton » Wed Jan 09, 2019 7:57 am

knpstr wrote:
Mon Jan 07, 2019 1:45 pm
I don't know that she will have billions. All of his Berkshire stock is going to charity.
She owns 1/2 of whatever her husband owns now and 100% after he dies. How much he can give away after death is a question for lawyers. His children can be cut out completely though.

I find it hard to believe someone with billions to invest would go with a 90/10 index funds. With that kind of money I would be buying politicians and judges all over the world to further my venture capitol schemes.

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Valuethinker » Wed Jan 09, 2019 8:45 am

DanMahowny wrote:
Wed Jan 09, 2019 7:33 am
Valuethinker wrote:
Wed Jan 09, 2019 6:24 am
DanMahowny wrote:
Mon Jan 07, 2019 3:26 pm
Even worse is Mr Buffett's diet. He eats like a 6 year old. Ice cream cones, popsicles, Cokes, and candy bars. Actually a 90/10 portfolio might be okay considering I'd be dead before I reach 60.
You need to (re)-watch Woody Allen's Sleeper ;-).

It is amazing what the 22nd century has discovered about our eating habits ;-).
I need to watch. Will be my first time. Thanks.
The "earlier, funnier" Woody Allen (that's a line from Stardust Memories). Basically everything up to and including "Hannah and Her Sisters". With a few "retro" efforts since (Bullets over Broadway, Radio Days, Manhattan Murder Mystery? perhaps). A clever mix of some quite subtle satire with pure slapstick and (to a teenage boy, as I was when I first saw them) lots of adolescent humour.

Sleeper gets funnier if you ever saw, for example, "Logan's Run" (movie with Michael York & Jennie Agutter, or TV series with Gregory Harrison and Donald Moffit) which take the idea of a dystopian future society quite seriously.

Bananas-Sleeper-Love & Death down to Annie Hall and Manhattan. Of course, now, we wonder at some of the elements which seem quite creepy seen in light of director's personal life.

But those first 3 are the classics of Woody Allen's early output which then built to the classics that are Annie Hall & Manhattan (& Hannah and Her Sisters). (He was also involved with the original Casino Royale, which was a total dog and nearly killed the James Bond franchise there and then; and Everything You Always Wanted to Know ... which has not aged well, but we live in a totally different cultural world now).

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Jeff Albertson » Wed Jan 09, 2019 10:32 am

Valuethinker wrote:
Wed Jan 09, 2019 8:45 am
Bananas-Sleeper-Love & Death down to Annie Hall and Manhattan. Of course, now, we wonder at some of the elements which seem quite creepy seen in light of director's personal life.
An earlier movie, a favorite, "Take the Money and Run". Even at 1:15 minutes into the movie there is something similar.
https://www.youtube.com/watch?v=qa87DmkuJi8

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Leesbro63 » Wed Jan 09, 2019 11:08 am

J G Bankerton wrote:
Wed Jan 09, 2019 7:57 am
knpstr wrote:
Mon Jan 07, 2019 1:45 pm
I don't know that she will have billions. All of his Berkshire stock is going to charity.
She owns 1/2 of whatever her husband owns now and 100% after he dies. How much he can give away after death is a question for lawyers. His children can be cut out completely though.

I find it hard to believe someone with billions to invest would go with a 90/10 index funds. With that kind of money I would be buying politicians and judges all over the world to further my venture capitol schemes.
Where did you come up with this questionable information? Did you forget that we are talking about Buffett’s second wife, who he married about 20 years ago? There is no doubt a prenup that would override any laws that would affect what a non-prenupped spouse would get.

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J G Bankerton
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by J G Bankerton » Wed Jan 09, 2019 11:57 am

Leesbro63 wrote:
Wed Jan 09, 2019 11:08 am
Where did you come up with this questionable information? Did you forget that we are talking about Buffett’s second wife, who he married about 20 years ago? There is no doubt a prenup that would override any laws that would affect what a non-prenupped spouse would get.
If there is a prenuptial agreement the Mr. Buffett is truly an "Oracle".

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Leesbro63 » Wed Jan 09, 2019 12:01 pm

J G Bankerton wrote:
Wed Jan 09, 2019 11:57 am
Leesbro63 wrote:
Wed Jan 09, 2019 11:08 am
Where did you come up with this questionable information? Did you forget that we are talking about Buffett’s second wife, who he married about 20 years ago? There is no doubt a prenup that would override any laws that would affect what a non-prenupped spouse would get.
If there is a prenuptial agreement the Mr. Buffett is truly an "Oracle".
He’s truly an Oracle. But you don’t need to be an Oracle to know that a 70 year old megabillionaire, marrying his housekeeper, needs a prenup.

Valuethinker
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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by Valuethinker » Wed Jan 09, 2019 12:02 pm

Jeff Albertson wrote:
Wed Jan 09, 2019 10:32 am
Valuethinker wrote:
Wed Jan 09, 2019 8:45 am
Bananas-Sleeper-Love & Death down to Annie Hall and Manhattan. Of course, now, we wonder at some of the elements which seem quite creepy seen in light of director's personal life.
An earlier movie, a favorite, "Take the Money and Run". Even at 1:15 minutes into the movie there is something similar.
https://www.youtube.com/watch?v=qa87DmkuJi8
Thank you.

I haven't seen that movie - probably should.

Projection is a common defence tactic of the damaged or immature psyche (I have read, I am not a professional in the field).

Thus we accuse others of the crimes we in fact have committed "you are lying" when we are lying, etc.

One wonders in the same way about Allen. His genius was making films about himself (Annie Hall). So.... ?

I am off topic again ;-).

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Re: A Test of Warren Buffett's 90:10 Retirement Portfolio

Post by knpstr » Wed Jan 09, 2019 12:31 pm

J G Bankerton wrote:
Wed Jan 09, 2019 7:57 am
knpstr wrote:
Mon Jan 07, 2019 1:45 pm
I don't know that she will have billions. All of his Berkshire stock is going to charity.
She owns 1/2 of whatever her husband owns now and 100% after he dies. How much he can give away after death is a question for lawyers. His children can be cut out completely though.

I find it hard to believe someone with billions to invest would go with a 90/10 index funds. With that kind of money I would be buying politicians and judges all over the world to further my venture capitol schemes.
He has already made it clear that he has committed and wishes 100% of his BRK stock to be left to charity. That isn't in question. So over 99% of his wealth will be (is already) going to charity.

It hasn't been made public how much will be left to his wife.
I don't believe any other aspects of his estate plan has been made public.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

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